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The housing market in May. Sales collapse, fewer and fewer apartments on offer

The housing market in May.  Sales collapse, fewer and fewer apartments on offer

It was dark in May in the housing markets of major cities. In all of them, experts from RynekPierwotny.pl note a significant decrease in apartment sales. How have prices changed?

This analysis contains detailed data on demand, supply and prices for apartments, which are prepared every month by the experts of the RynekPierwotny.pl portal, based on the first national platform for independent analysis of the housing market – Big Data Rynek.

May data shows that in the seven largest cities, developers sold a total of only 2,447 apartments, which is 35 percent worse than the April result!

Of course, compared to May 2021, sales were up to 49 percent lower, however, loans were record cheap. Moreover, due to high inflation, many wealthy Polish people invested their surplus money in apartments, hoping to increase their value and rental income. This year, however, there is a prevalent belief among experts that housing demand will decline due to higher interest rates on housing loans and the economic effects of the war in Ukraine. May sales data seem to confirm these expectations.

True, a month ago, RynekPierwotny.pl experts recorded an increase in sales, but at that time it was noted that this could have been a temporary recovery, in connection with the announcement of the entry into the new recommendation of the Polish Financial Supervisory Authority. Coming into effect in April.

Its effect is to reduce the creditworthiness of potential apartment buyers. So – according to the Credit Information Bureau (BIK) – the number of people wanting to buy home loans rose sharply in March. They just wanted to move forward with more favorable rules so that they could carry out their plans. In April, this led to an increase in final housing transactions. April saw a crash in the housing loan market, which led to the sale of apartments in May.

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The sale of apartments fell very sharply in all the cities we analyzed! Of course, the order situation in each city is still very diverse. The problem is that May may disappoint those who a month ago counted on stabilizing sales or even a slight increase in sales in some cities.

We dealt with such a situation, for example, at ód, where April sales reached 160 percent. higher than in March. Unfortunately, May saw a 42 percent decline.

Developers in Warsaw, Krakow, and Wroclaw also have reasons for concern. In April, they could enjoy more contracts, but in May, they didn’t have much to be happy about. They sold 24% less apartments than in April, and 38%, respectively. And 40% there hasn’t been a weak month in terms of sales in the capital since the Covid-19 shutdown in April 2020.

In these cities, sales were much worse than in the corresponding period last year, for example in Warsaw by as much as 54 percent, and in Wroclaw – by 49 percent.

Sales continued to decline in Poznan (32 percent) and Gdansk (40 percent). In the capital of Wielkopolska, developers found people willing to buy only 154 apartments! Also in this city, the worst month in terms of sales was April 2020. For comparison, last year Poznan developers sold an average of 426 apartments per month, and in the first four months of this year – this average was 400 apartments. The May result proves a significant drop in sales.

Sales data for the five-month period of 2022 is also pessimistic. In all the cities analyzed, the demand for new apartments has clearly decreased compared to the same period last year. Most are in Wroclaw (48%), Warsaw (44%) and Gdansk (37%).

How was the presentation? In all of the cities we analyzed, 1,852 apartments were sold in total, that’s up to 46 percent. lower than in April. In Katowice, developers have apparently stopped introducing new apartments to the market.

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As much as 88 percent a decrease was recorded in the number of apartments for sale in Poznan. In Warsaw, the supply in May was 26 percent less than in April, and in Wroclaw – by 65 percent.

However, from the introduction by developers to the market increased by 7 percent. Potential lodge buyers can enjoy more than a month in advance.

MarketPierwotny.pl experts note that in all the analyzed cities, developers released apartments for sale less than they sold. In Warsaw, it seems as if the developers have implemented Handbrake.

Interestingly, the number of apartments offered by developers increased in Katowice and Krakow, and did not change in Warsaw, although in May the sale of apartments in these cities exceeded the new offer.

This may indicate, for example, that some customers have terminated their contracts with developers, so previously “sold” apartments are back on offer.

Unfortunately, supply has visibly reduced in other major cities, although the end of last year gave hope for an improvement in the supply situation.

It should also be noted that in Warsaw, لودód, Kraków, Gdansk and Katowice, the supply of apartments in May was greater than last year, for example in the capital by 21 percent, in Katowice – by 32 percent, and in وودód by the same 64 percent hundred..

How did this affect the prices of apartments? Data from BIG DATA RynekPierwotny.pl shows that May halted the growth of the average price per square meter for apartments offered by developers. In Katowice, Krakow, لودód and Pozna, the average remained at the level from April, and in Gdansk it fell by as much as 2%. This is the result of launching a range of apartments at an average price of approx. Polish zlotys per square meter, which is significantly below the average in width, which in May amounted to 11.4 thousand. Polish zlotys per metre.

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Only 1 per cent. An increase in the average price per square meter was recorded in Warsaw and Wroclaw.

Comparing the average price per square meter year on year, the leaders in increases are Poznan and Katowice. In May, it was in these cities by up to 24 percent. higher than in the same period last year. A twofold increase was recorded in all cities. At the same time, Krakow was almost half less than in both cities mentioned above.

Rising construction costs mean that the price bar continues to rise. The changes can be seen better when comparing the price structure of apartments. Over the past year, the number of apartments in all cities was lower at a price below 8000. PLN per square meter

The most dramatic change is observed in Poznan, where in May last year it reached 71 percent. Apartments offered by developers cost less than 8 thousand. Polish zlotys per metre. After a year, the share of such cheap buildings is … 7%! In Warsaw and Krakow, such performances can be counted literally on the fingers.

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